The 30‑year Treasury yield spiked to 5.61% on Tuesday, marking its highest level since 2002. It climbed past the 5.61% threshold for a sixth consecutive day, pushing the long‑dated bond into a zone that had been common before the prolonged low‑rate era.
Oil prices surged, feeding inflationary pressure while a global debt sell‑off intensified. The 10‑year yield sits at 5.28%, its strongest read since 2007, and the two‑year is at 4.93%, the last major maturity to stay under 5%. The Treasury market has lost 2.6% year‑to‑date, a stark contrast to the 6.3% gain it posted last year.
Strategists see the sell‑off as a "light buyer’s strike". Monty Gandhi of SMBC noted, "The long‑end move is likely tied to the largest syndicated debt package for Warner Bros. Discovery." Meanwhile, Jim Bianco, a veteran Wall Street trader, turned bullish on Treasuries after six years, and Mark Dowding of RBC BlueBay Asset Management warned that the market has over‑reacted.
Looking ahead, traders will watch the Fed’s policy meeting in early October for clues on whether rates will climb further. Seasonal dynamics and the ongoing Middle Eastern tensions could keep volatility high, as TD Securities’ Prashant Newnaha cautions that de‑risking may spill into equities if no resolution emerges. Investors should stay alert for potential rebounds as the market digests the long‑term supply shock.